Social Good

Startup Helps Young Talent Crowdfund Their Careers

Several challenges face aspiring young professionals these days, such as student loan debt and rampant unemployment and underemployment. Pave, a New York startup launched Wednesday, has an idea it thinks will help these young adults achieve their potential.

Pave pairs young Americans with the resources they need to pursue the career of their dreams, relieving them from resorting to jobs that stray from their passions. These recipients, known as prospects, are matched with a group of backers who give them the funds they request to pursue their goals.

There's something besides altruism in it for the backers, too: Prospects are contractually bound to return an agreed upon portion — say 5% — of their earnings each month. If a filmmaker working on a long-term project has no income, the backers get nothing. If a musician flops throughout the 10 years of the contract, the backers get nothing, as well.

But Pave's founders doubt that will happen.

"We're an online funding community that empowers young people to pursue their passions," Pave CEO and co-founder Sal Lahoud said at the startup's launch event in its SoHo office. "This is a social share agreement, not a loan, that allows you to take risks."

What differentiates Pave relationships from loans is that no money is owed at the end of the 10-year period if no money is made.

Lahoud thought up the model after a friend asked him to borrow money. Rather than entering into a loan — which could easily result in an awkward situation between friends — the Pave founder suggested his friend repay him with a portion of his earnings. His friend happily agreed, eager to share in his successes. This lead Lahoud to realize that, in this age of online communities, a model of shared successes could work as a business.

At launch, Pave is funded by private investors and monetizes by taking a cut of money raised on the site.

Beyond matching prospects with funds, Pave provides an opportunity for mentorship from the backers. The site is designed as an online hub for building relationships. Backers invest in individuals and know their stories, which to some may be a more appealing investment than a fledging company.

"I know the first money transfer is just the beginning," Terrance Ross, a 22-year-old journalist and member of Pave's inaugural group of prospects said.

Lahoud added that Pave is unlike a traditional loan because it doesn't define what success means. Future plans or goals can change during the 10-year mentorship period, though Pave's founders believe young adults offered the chance to pursue their passions will ultimately contribute more to society than if they had been forced down an unfulfilling path.

Would you participate in a Pave exchange either as a prospect or a backer? Let us know in the comments.

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